What is L-BTC?

L-BTC is a token created through the mutual mapping between Bitcoin and the BEVM(λ) ecosystem. In BEVM, users establish channels between their Lightning Network nodes and BEVM's Lightning Network nodes. Whenever a channel is established, users receive an equivalent amount of L-BTC on BEVM, maintaining a 1:1 mapping ratio. L-BTC is fully self-custodial and does not support direct transfers, being exclusively used for staking. This makes L-BTC a self-custodial asset for interaction between the Lightning Network and BEVM(λ) system.

Role of L-BTC

One of L-BTC's design purposes is to serve as part of the dual-token Proof of Stake (PoS) mechanism. In the dual-token PoS model, L-BTC primarily functions as an additional form of BEVM token, allowing users to participate in BEVM network's consensus mechanism by staking L-BTC. L-BTC represents both users' contributions to the Bitcoin network and increases their consensus participation weight through BEVM(λ) network's proof-of-stake mechanism.

Specifically, L-BTC acts as a bridge token, ensuring asset liquidity between the Bitcoin network and BEVM network, allowing users to influence their stake and participation in the BEVM network through their activity level in the Lightning Network. This design effectively enhances network decentralization and avoids the risk of single capital concentration.

L-BTC as Part of Dual-Token PoS In the dual-token PoS mechanism, L-BTC is part of achieving network consensus by combining Bitcoin's computing power and BEVM's proof of stake. Specifically, L-BTC plays key roles in:

1. Stake Pledging: L-BTC can be staked to participate in the PoS consensus mechanism. Nodes staking L-BTC can obtain consensus participation opportunities based on their L-BTC weight, determining whether they become network validators.

2. Reward Distribution: Through a probabilistic reward distribution mechanism, L-BTC holders participate in generating new blocks and receive BEVM rewards based on their stake amount and network activity.

3. Decentralization and Security: L-BTC usage in the Lightning Network strengthens network decentralization, combining BTC's computational contribution and L-BTC's stake contribution to avoid wealth concentration issues common in traditional PoS.

Mechanism

L-BTC Interaction Mechanism As a self-custodial asset, users can perform the following operations with L-BTC through the Lightning Network:

1. L-BTC Generation: Users establish channels between their Lightning Network nodes and BEVM's Lightning Network nodes to receive an equivalent amount of L-BTC. L-BTC is fully user-controlled, cannot be directly transferred, and can only participate in network consensus through staking.

2. L-BTC to BTC Conversion: Users initiate Send operations within Lightning Network channels to convert L-BTC to BTC. This process occurs through the Lightning Network, ensuring asset liquidity.

3. BTC to L-BTC Conversion: Users call contracts on BEVM to initiate L-BTC withdrawal operations, converting BTC to L-BTC for staking and proof of stake in the BEVM network.

4. L-BTC Redemption: When users close Lightning Network channels, staked L-BTC automatically burns while exchanging for corresponding BTC in the Bitcoin network.

L-BTC's not just a bridge tool between Bitcoin and BEVM networks but also an essential component of the dual-token PoS mechanism, helping achieve decentralization, security, and reward fairness. Through L-BTC, users can flow assets between Bitcoin and BEVM networks and participate in consensus mechanisms, promoting healthy development of the entire ecosystem.